Stock market gains on disinflation data; Disney Sub’s Growth Fuels Strong Rise
The stock market rose Thursday afternoon amid rising jobless claims, buoyed by July’s decline in wholesale prices. waltz disney (DIS) surged on the back of profits and robust Disney+ subscriber growth.
The Dow Jones Industrial Average led the major indexes, up 0.4%. The Nasdaq composite traded down 0.1% while the S&P 500 gained 0.3%. The small cap Russell 2000 Index gave up some early gains but was still 0.5% higher in afternoon trading.
Volume climbed more than 27% on the Nasdaq but only 3% on the NYSE from the same time Wednesday.
Overview of the US stock market today
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The Innovator IBD 50 ETF (FFTY) gained 0.2%.
Rising Unemployment Insurance Claims: A Threat to the Stock Market?
Initial jobless claims rose to 262,000, slightly above estimates of 260,000 and above the 248,000 reported the previous week.
The producer price index, which measures the monthly change in the price of goods and services received by manufacturers, fell 0.5% in July from the previous month. Economists had expected an increase of 0.3%. The PPI climbed 9.8% from a year ago, also less than expected.
“A growing risk to the market outlook is the upward trend in the number of people claiming unemployment benefits,” said Jeffrey Roach, chief economist for LPL Financial. “Initial claims and continuing claims have increased slightly over the past four months and suggest the labor market is likely to slow further through the second half of this year.”
Roach also noted that “the cooling in prices paid by producers portends a further cooling in consumer prices, as producer prices are higher in the inflation pipelines. We expect prices to production slackens as supply chains improve.”
The 10-year US Treasury yield rose six basis points to 2.84%. Crude oil prices jumped 1.6% to $93.40 a barrel. Oil inventories have increased.
The S&P Energy Select Sector ETF (XLE) jumped 2.5%, easily outpacing all other S&P sectors.
Disney skyrockets on subscriber growth
Shares of Disney jumped 6% after the company reported second-quarter earnings of $1.09 per share on revenue of $21.5 billion, beating estimates of 98 cents EPS. However, revenue fell short of the consensus of $20.99 billion.
Membership growth for Disney+ increased by 14.4 million while global theme park revenue rose, despite inflation fears.
Disney stock is climbing from a low in mid-July, working on its fourth consecutive weekly advance. However, at around 119 per share, it is still trading well below its March 2021 high of 203.02.
The Dow Jones leader plans to raise prices for the Disney+ streaming service by 38%, along with comparable increases for its Hulu and ESPN+ units. The base of 221 million subscribers is now greater than netflixfrom the subscriber base of (NFLX). Disney is aiming for 260 million subscribers by 2024.
Recent IPO gains on better than expected sales
Recent stock market IPO Privia Health (PRVA) climbed nearly 10% despite losing 10 cents a share on $335.5 million in sales in the second quarter. Analysts polled by FactSet expected the medical software maker to report no profit, but only $313 million in sales.
Golar LNG (GLNG) rose 4% on Thursday after the liquefied natural gas transmission/processing company posted higher-than-expected second-quarter profits.
The financial results come just a week after Freeport LNG announced that its main export terminal, which has been offline since early June, is expected to resume partial operations in October.
IBD 50 Petroleum Exploration and Production Company Matador Resources (MTDR) comes out of a handle cup base with a buy point of 58.68.
Follow Michael Molinski on Twitter @IMmolinski
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